MIAMI – House Democrats released a proposal on Monday for an additional US$28bn in payroll relief for the airline industry. This comes as part of Democrats’ proposal for a new US$2.2tn coronavirus aid bill.
The latest pandemic relief package would give US$25bn to passenger carriers and US$3bn to airline contractors to cover their payrolls through next March. Current measures to protect these jobs expire on Thursday.
Under the CARES Act relief fund that passed this spring, airlines are prohibited from laying off any employees until October 1. Airlines have warned that without additional aid, they will have to cut over 35,000 jobs.
Aid for Struggling Airports
Airports are also struggling financially as a result of dramatic drops in passenger numbers due to the pandemic. Under the new proposal, an additional US$13.5bn for airports would be provided. At least 25% of this must go to airport restaurants and retailers.
Whilst both Democrats and Republicans support additional relief, they have yet to agree on the amount of stimulus needed.
The new bill is the Democrats’ latest effort to engage Republicans in further negotiations on COVID-19 relief before the November 3 elections. The proposal is US$1tn less expensive than the House bill that passed in May. That bill did not include an extension of airline relief.
Dems are joined by other goverment bodies in their plea for a second aid package for the US commercial aviation industry. Just last night, the US Treasury Department announced it closed loan deals with seven airlines. It also joined the industry in asking Congress to further extend its aid to prevent massive job cuts later this week.
Uncertainty ahead for Airline Employees
Passenger numbers are down 68% compared to 2019, according to the latest seven-day average count from the Transportation Security Administration (TSA). This means that without further aid, tens of thousands of airline jobs are on the line.
Just yesterday, United Airlines (UA) Pilots voted to reduce their flying hours in order to cancel 2850 scheduled furloughs. The industry group Airlines for America (A4A), which advocates for US airlines, has been lobbying for US$25bn in aid, which they say can postpone job cuts until April.
Comments from A4A
A4A CEO Nicholas Calio said in a statement on Monday, “We appreciate that the House HEROES Act prioritizes extending the Payroll Support Program for U.S. airline industry workers. We applaud the congressional leadership for acknowledging the urgency of the situation and are grateful for the continued strong, bipartisan support from Congress, but time is running out to protect the jobs and livelihoods of tens of thousands of U.S. airline employees,”
He added, “We remain hopeful that Congress will act swiftly before the current Payroll Support Program expires on September 30 to preserve the jobs of these flight attendants, pilots, mechanics, gate agents and others who are truly the backbone of our industry.”
Featured image: American Airlines Boeing 787 at LAX: Photo: Luca Flores